“China, huh... China.”
Department Head Oh set down the report and sighed.
“So what was the result of the meeting?”
Director Yu of the Alternative Investment Team answered with a bitter smile.
“It was neck and neck. All the outsourced managers were split in their opinions.”
“Neck and neck? Not overwhelmingly opposed, but neck and neck?”
“Yes. Of course, Chinese real estate shows no signs of recovering right away, but many said that in the long term, you never know.”
“What was China’s economic growth rate last year?”
“In the five-percent range. If that growth rate is maintained for close to ten years, Chinese real estate will recover eventually.”
Department Head Oh clicked his tongue.
“That bastard is the problem, I swear. Why does he keep singing China’s praises?”
“Tell me about it. Haha...”
“But we have to consider opportunity cost carefully too. In ten years, other assets will have at least doubled, but if Chinese real estate only starts recovering around then, that’s money we could have made but didn’t.”
“That’s true. Even within real estate, New York or Silicon Valley has better prospects. Not Beijing or Shanghai. However... we made quite a lot from Seoul real estate this time. All the outsourced managers earned an average return of 20%.”
“So?”
“We’re thinking of giving them autonomy. Letting the outsourced managers invest on their own. For now, we’ll recover the 20% profit and let them decide the rest as autonomous investments. But...”
“But?”
Director Yu spoke with a troubled expression.
“It’s Team Lead Lee’s opinion. He seems to want us to leave the outsourced managers’ investments up to them, but make sure the money we invest directly goes into Chinese real estate.”
“The Alternative Investment Office’s direct investments go to China?”
“Yes. To be honest, even with this profit, it was Team Lead Lee who decided the investment targets for the outsourced managers. That 20% profit belongs entirely to him.”
“Good grief...”
“So we’re planning to reinvest a considerable portion of the recovered funds into China.”
Department Head Oh fell into deep thought.
No sane investor would touch Chinese real estate right now.
Five years ago, China had gone through a real estate overheating far greater than anything Korea’s market had seen. Following the rapid growth that began in 2000, housing prices in first-tier cities had risen by an average of 13% per year.
As a result, by the time they peaked in 2021, housing prices had risen almost tenfold compared to twenty years earlier. Even accounting for inflation and economic growth, it was an absurdly high figure.
And now, they were paying the price.
Chinese real estate, according to last year’s figures, had plunged about 30% from its peak. Four straight years of stagnant housing prices had brought on an unprecedented construction freeze, and that construction slump was dragging down China’s overall growth like a drowning man pulling others under.
“Why on earth would he...”
Department Head Oh still couldn’t agree.
No matter how he looked at it, all he saw were flies swarming around dung. Where exactly was the smell of money supposed to be coming from?
“What should we do? Should we try to break Team Lead Lee’s stubbornness...?”
But since all these buy reports were none other than Lee Sejun’s insistence, it was difficult to refuse outright.
After a long period of thought, Department Head Oh shook his head.
“I know him well. He’s not the type to bend just because we try to break his stubbornness. If we block him from buying, he’ll secretly pressure the outsourced managers into buying.”
“Then...”
“The profit we made from Seoul real estate was 20%, right? Then let’s just treat that money as if we never earned it. Buy Chinese real estate according to Team Lead Lee’s portfolio. Ah, but aren’t there restrictions on foreign purchases? Chinese regulations should be even stricter than ours.”
“All those regulations were abolished long ago. Recently, they’ve lifted every restriction, starting with LTV and even foreign purchases.”
Department Head Oh smiled bitterly.
Just how bad was real estate over there for the Chinese authorities to lift all those regulations...? Real estate was a shared headache for every country, so regulation was a guaranteed sign of rising prices, and easing was a guaranteed sign of falling prices.
“Then there won’t be a problem buying?”
“No. That’s why he says now is the right time.”
“Understood. To be honest, global stock markets have been too high lately, so the division head has also been emphasizing alternative assets. You take the lead and handle it properly.”
“Understood.”
When all the instructions had been given, Department Head Oh asked,
“But where is that bastard now? I swear, I haven’t seen him come to work lately.”
*
-Road No. 1 has been closed. You may depart!
-Road No. 3 has been closed. You may depart!
-All vehicle models are on standby. You may depart!
The Second Ring Expressway in Namyangju.
The Asan Motors researchers waited on the expressway, palms sweating.
The government, which had recently been pushing hard for autonomous driving, had even closed an actual expressway to provide Asan Motors with a test bed.
And today was the day of destiny.
Because the twenty vehicle models currently waiting at the starting line were representatives from various countries, each with different nationalities and brands, awaiting a cold evaluation.
“Yes, good. Control team, continue controlling the surrounding vehicles, and test team, start the vehicles.”
At Chairman Choi Seongjin’s instruction, twenty unmanned vehicles began departing down the road.
The test team tested Korea’s autonomous driving performance through different scenarios: when a vehicle suddenly cut in, when the vehicle ahead braked abruptly, when forward visibility was not secured, and so on.
-Bang, bang!
-Whoosh!
Before long, some vehicles had flipped over, some had gone flying, and some had rammed their heads into the guardrail.
Choi Seongjin smiled bitterly each time a test was carried out, and the researchers began recording every detail.
*
“Hello, Chairman.”
“Welcome, Team Lead.”
“It feels like it’s been a while since I last saw you.”
“It certainly does. You should have come more often. We had plenty to boast about with the technology we’ve built up.”
“Is that so? Haha.”
Chairman Choi Seongjin welcomed me brightly on the day I visited the Namyangju Research Center.
In truth, there hadn’t been much good news for Asan Motors lately. After the bleeding competition began, Asan Motors’ retained earnings had been shrinking rapidly, and with BYD’s arrival in Korea, they now had to engage in a bloody fight even on home turf.
“I know there have been a lot of adverse factors lately, but you look better than before, Chairman.”
“Thanks to you, Team Lead. Over the past year, we’ve accumulated a lot of database material from autonomous driving in downtown Seoul.”
“I heard you even conducted a road closure test last week... Were the results good?”
“I’ll explain the details inside. Please come in.”
Following his guidance, I entered the office, where all the employees of the Namyang Research Center were waiting.
“Please sit. And these are the test results.”
I looked at the results sheet he handed me and was unable to speak for a while.
“Before I explain the data, I should mention in advance that China already completed an experiment like this three years ago. And at the time, the only vehicles that passed all the conditions were two Teslan models.”
China’s autonomous vehicle experiment had shocked everyone.
At the time, that experiment showed that only Teslan’s vehicle models had passed every test, and the Chinese authorities had announced it themselves without hiding it.
To compare it to Korea, it was like revealing through our own experiment that Japanese car technology was superior.
“And at the time, Korean autonomous driving technology didn’t even make it into the rankings.”
“Yes. How was it this time?”
Choi Seongjin smiled bitterly.
“Not very different. In this autonomous driving test as well, the ones that passed every test were Teslan vehicles. In fact, the evaluation was even better than back then. In this experiment, all four of Teslan’s current models—Model S, 3, X, and Y—passed the tests.”
My fist clenched. American technology was pulling ahead again.
“Also, Chinese autonomous vehicles have improved far beyond what was announced three years ago. Under the same conditions, the safety of BYD, Xiaomi, Huawei, and others improved further, and at this rate, we expect they may soon become comparable to American technology.”
“What about Korea... What about our Asan Motors?”
“Thankfully, we’ve improved as well.”
Choi Seongjin clenched his fist tightly.
“If we had to rank them, after the United States and China came us. Until now, our Asan Motors had been at HDA2 level on roads, but we lagged behind in competitiveness for city driving. However, by driving autonomously in urban areas recently, our technology has improved significantly.”
Choi Seongjin moved the PPT to the next slide.
“To explain with as few technical terms as possible, there were major improvements in the emergency braking and sudden stop systems. Part of this came from improved recognition ability in judging obstacles ahead, and part from improvements to the internal braking system. In this experiment, we also tested automatic control ability when forward visibility was difficult to secure due to rain, fog, and the like. In this area, if in the past it led to accidents nine times out of ten, this time it was only about five times. I believe this is something our researchers must improve going forward.”
The data accumulated over the past year in downtown Seoul had led to remarkable progress.
Amid Korea’s uniquely rough road culture, our autonomous driving technology had rapidly accumulated data. Thanks to that, while it still wasn’t technology capable of challenging the G2, we could at least say with confidence that we did not lag behind Europe.
“...We still have a long way to go.”
“Yes, we still have a long way to go. But I’m confident. In just one year since the regulations were lifted, we’ve achieved a considerable concentration of technology as well. If the government helps us like this, there’s nothing we can’t do.”
“Then what is your plan going forward?”
“Massive research and development costs. We’ll double the current R&D investment to attract talent.”
After finishing his explanation, he paused for a moment before asking me.
“So, Team Lead... we need some money. A paid-in capital increase or an interest-free loan... no, a low-interest loan. Would that be possible...?”
I smiled bitterly.
“How much do you need?”
“At the very least, in the hundreds of billions of won.”
“May I hear your funding plan?”
“The researchers’ value and technology development costs. In particular, we are currently staking everything on battery development. We’re continuing to prepare experiments to increase fast charging and capacity.”
After hearing his explanation, I asked him a fundamental question, one that could only be extremely uncomfortable.
“Chairman, to be blunt, current technology isn’t the only problem, is it? Based on our analysis of models on the market, Asan Motors is about 50% more expensive than BYD. Unit cost... Is cost innovation impossible?”
He spoke with a calm expression.
“Of course we’re doing it. Accordingly, we’re also developing robotics and automated processes. But I believe technology, rather than cost, will ultimately have a major influence on the market. In particular, we are currently putting tremendous effort into the battery field. To be truly blunt, even if Asan Motors goes under, we intend to maintain a competitive advantage in core components so that people cannot avoid using Asan batteries. Like Hoam Electronics supplying displays to Apple.”
Looking at his resolute expression, I answered.
“That sounds good. I think it’s entirely possible.”
“Then...”
“Tell me the funds you need. I’ll review it and give you an answer.”